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German seven-year bond yields fell below zero for the first time ever on Thursday, as investors positioned themselves for an extended era of cheap money ahead of the European Central Bank's looming bond-buying scheme.
Central banks' battle to keep cash flowing into the financial system has driven other core European government bond yields into or close to negative territory.
That has pushed investors into higher-yielding equities, which remained near all-time highs on Thursday despite a mixed performance.
Bets that a US rate hike might come later than expected, triggered by comments by Fed chair Janet Yellen this week, have also pushed bond yields lower.
The new record low of -0.003% for German seven-year sovereign bonds came after Germany sold its first five-year debt with negative yields on Wednesday and after Irish borrowing rates fell below 1% for the first time.
There was also good news from Germany on consumer morale, which rose to its highest level in more than 13 years heading into March as low oil prices fed through to households.
US Treasuries prices had also risen modestly on Wednesday following two days of testimony from Yellen, which traders interpreted as suggesting the Fed could hike rates later than mid-year.
"The massive liquidity on the market has been pushing yields down," said Saxo Bank trader Andrea Tueni.
The MSCI All-Country World global share index ticked up 0.1%, though Asian shares slipped back from a five-month high and European shares opened flat.
Corporate updates in Europe from blue chips including Anheuser-Busch Inbev, Allianz and Deutsche Telekom left the pan-European FTSEurofirst 300 up 0.1%.
About two thirds of the way into Europe's earnings season, 55% of companies have met or beaten profit forecasts. Overall, fourth-quarter earnings are expected to grow by 19.5%, according to Thomson Reuters I/B/E/S, which would be Europe's best season in 3-1/2 years.
The financial sector was also in focus after Asia-focused bank Standard Chartered said former JPMorgan investment bank boss Bill Winters will take over as chief executive in June. The bank's shares were up 1.4%.
Shares of Royal Bank of Scotland fell 2%, meanwhile, after reporting a 2014 loss of 3.5 billion pounds.
Emerging markets got support from Yellen's comments and a steadier US dollar, with the Russian up for the third straight day.
Greek equities were down more than 2%, with the country's fate in focus after it said on Wednesday it would struggle to make debt repayments to the International Monetary Fund and the European Central Bank this year.
In commodity markets, Brent crude fell towards $61 per barrel after a rally in the previous session, as bulging US crude stockpiles offset indications of a demand recovery.
London copper prices neared a six-week peak and gold gained for the second day on views of a US rate-hike delay.
